The Rollercoaster Podcast with Nikunj Kothari

Sheila Vashee - VC at Basis Set Ventures

November 09, 2020 Nikunj Kothari Season 1 Episode 2
The Rollercoaster Podcast with Nikunj Kothari
Sheila Vashee - VC at Basis Set Ventures
Show Notes Transcript

For today's episode, we chat with Sheila Vashee (@sheilavashee). Sheila works as a partner and venture capitalist at Basis Set Ventures. Prior to this, she was the vice president of Growth at Opendoor and the second marketing hire at Dropbox. 

In this episode, Sheila talks about her incredible journey. Some highlights being:

  • Starting a brownie company at age 8
  • Becoming an investment banker after her undergrad in college
  • Transitioning into corporate strategy at Gap
  • Being the second marketing hire at Dropbox
  • Learning how to navigate growth and operations at Opendoor 
  • Early career as a VC at Basis Set Ventures

Thanks for listening — if you like what you hear, please review us on your favorite podcast platform. 

Check us out on the web at http://rollercoaster.life/ or get in touch with us on Twitter @rollerpod or emailing me at [email protected]

Music: Nowhere land & Wholesome by Kevin MacLeod.
License: http://creativecommons.org/licenses/by/4.0/

Nikunj: Hey Sheila, welcome to the show today. I'm really looking forward to this.

Sheila Vashee: [00:01:14] Thank you. I'm looking forward to it as well.

Nikunj: [00:01:16] I want to start off by saying thank you for taking the time to do this again, after I forgot to record the first session.

Sheila Vashee: [00:01:24] Nikunj, I'll take any opportunity to hang with you. So if that means doing this again, I'm all for it.

Nikunj: [00:01:30] I appreciate that. How are you and the little ones doing? Are you guys getting a little stir crazy?

Sheila Vashee: [00:01:35] We're going completely nuts all being at home. Luckily the preschoolers back in school. So it gives us a little bit of breathing room,  but now, yeah, we're w we're all crazy at this point.

Nikunj: [00:01:46] Yeah, I think that's all of us in 2020. Speaking of your little ones, I like to start with hearing a little bit about your childhood. You were born in the United States, but your parents moved here when you were quite young. What was that like  for your family?

 Sheila Vashee: [00:02:00] So my parents were immigrants. They moved here from India a few years before I was born and the mentality really pervaded my childhood growing up. So they came here with nothing, worked for everything that we had, and that was how we operated throughout our lives. we're used to hard work and used to paving the way for ourselves.

Nikunj: [00:02:24] You moved it out a lot in your early childhood. Did you like it or hate it?

Sheila Vashee: [00:02:30] I did move around a lot. My, it was, parents getting transferred or other reasons we ended up moving every couple of years. I ended up changing schools every couple of years. I hated it at the time. Of course. what kid wants to leave their friends and make a whole new set of friends in a new city.

But I think that in retrospect it was actually very character-building for me, because I had to learn how to meet people in a new environment, get to them quickly, be able to create a community quickly. And it taught me those things. So in retrospect, I'm grateful. Thanks, mom and dad for moving us so often at the time I was extremely upset.

 Nikunj: [00:03:10] Were you one of the very few people of color in your school?

Sheila Vashee: [00:03:15] I was, and I think at the time I probably didn't realize how significant it was. I think now with the state of our country and the presidential election. For me actually getting exposure to all parts of the country. And I live in the South. I lived in the Northeast, I lived in the Midwest and really understanding where people are coming from.

And oftentimes, as you said, being the only person of color in the school or in the class, taught me. On one hand appreciation, for different mindsets. On the other hand, it taught me a good amount of grit because there were many times when people didn't understand where I came from or, or who I was, or my background.

And that gave me a tough skin, for the rest of my life, actually.

Nikunj: [00:04:09] That must have been extremely character-building as you were growing up as well. And then you started on your entrepreneurial journey quite early, at age eight. you had started doing some ventures on the side. Tell us a bit more of what you remember of that time.

Sheila Vashee: [00:04:25] I did. I did, as I mentioned, my parents were immigrants with very much a builder mentality. And so they. Pass that onto me at a very young age. And and also, I never had an allowance growing up. And so it was very much a you eat what you kill situation. So if I wanted to have money to do things, I needed to figure out how to earn some.

So I started off, but with a greeting card business that, I was able to, Sell my wares to everyone in the neighborhood or push them on people in the neighborhood. And I started off with, there were a generic set of cards that were 25 cents and then different sets of customization made the cards more expensive and it was a consultative strategy.

People told me what they wanted. And I was able to deliver, so that was my first business. Then I had a brownie company and it was actually a company. It wasn't just a brownie stand. I had a logo and everything that I print it onto two stickers and put on the boxes. so as I said, yeah, I was looking for every opportunity to make a quick buck and,  I remember there was a show and tell that I had to do in elementary school. This was like maybe first or maybe second or third grade actually. And everyone, did things like, okay, here's how I bake my favorite brownies or  here's how I do my hair in the morning. And, mine was on how to do a sales call and I literally walked people through all the steps, and how to position what you were selling.

And, no one was paying attention for that show itself

Nikunj: [00:05:54] I'm sure that was a big hit, 

Sheila Vashee: [00:05:56] know your audience.

Nikunj: [00:05:59] so you've finished elementary and high school, and then you end up going to Stanford for your undergrad. And then, you get a BA there in 2005 and you decided to go work at Morgan Stanley. How did you end up, going from the mecca of entrepreneurial places to being an investment banker?

Sheila Vashee: [00:06:20] it was a bit of a left turn for me, given what I spent  most of my life doing up until that point. And I think the circumstances of what was happening in Silicon Valley at the time were very relevant.  The first year of college was the.com crash and 9/11 and everyone was very afraid to take risks. And tech was seen as a risk. Obviously, amazing companies has started at that time, like Facebook and Google was hitting its prime. And and a lot of people that I went to school with went to those companies, which was a very smart strategy. I decided to go to investment banking. It felt very safe. And I have a lot to be thankful for. In that I learned, and I was able to get a good grounding in finance and other things, but culture wise, it was not a good fit for me at all. And, and I really felt like I didn't fit in, talk about not fitting in being the only person of color of any times in my class.

This was more, I stuck out more like a sore thumb in investment banking actually. so that wasn't a good fit for me. I ended up leaving and transitioned to, a role at the Gap on a corporate strategy team, which was the internal strategy internal kind of consulting team.

And it was an really interesting role. We were able to work on the most interesting projects, like a China entry strategy or a new brand concept. And it was a really interesting time to be in retail too, because Gap is under fire from basically every direction, Amazon to European best fashion to, target even. So it was a really interesting time to be there. I learned a lot.

Nikunj: [00:08:00] And this was pre Gap being the conglomerate that was this pre banana Republic and old Navy

Sheila Vashee: [00:08:05] it was just post. Yeah, it was post. They had just, acquired all those brands or, yeah, combined.

Nikunj: [00:08:11] That's awesome. So you went an investment banker, a corporate strategist, and you ended up finishing your MBA in Haas in 2012. How did marketing fit in all of these different areas?

Sheila Vashee: [00:08:25] I wanted to get back into tech and I had a real interest and appreciation for marketing. From my time at gap, I got a chance to work with the marketing teams there, and they were so instrumental for the business and building the brands that, it was something I wanted to learn. while I was in business school, I did an internship at Apple and worked there part-time for part of the school year. But then ended up actually joining Dropbox, when I graduated and I was actually the second marketing hire, so was able to really see the journey of the company and the products launched the business product and, basically every other product from there, it was a, learn so much from that experience.

Nikunj: [00:09:05] Tell us a bit more about how you decided to end up joining Dropbox early, rather than going back to Apple

Sheila Vashee: [00:09:12] Yeah, Apple's an amazing company, but it's huge. And the summer that I was there, I was working on the launches of the current iPhone. I think it was the 4S at the time. I don't remember. It was a long time ago, but it's like the company is so siloed and so secretive that didn't really know what else was happening.

So the, actually the person in the office next to me was working on the iPhone five and the person in the office next to him was working on the iPhone six, but I never met them or saw them or talked to them. And it was very actually quite an isolating experience. And so for me, that also didn't fit with kind of my personality.

So I was looking for a company where there was more of a team feeling and feeling like it was you against the world, which was a very much Dropbox in the early days.

Nikunj: [00:09:57] Dropbox  oversaw the massive app growth on the personal side, but I think Dropbox also was one of the first early players of what I call the consumerization of the enterprise. I remember Dropbox being one of the few companies that was able to. To do it quite well. I used it for my personal, but then I started using it for work as well.

Tell us a bit more about the insights of the journey of how Dropbox was able to make that happen.

Sheila Vashee: [00:10:21] Absolutely. Dropbox was really on the frontier of that trend. And now it's, consumerization of IT and product led growth really, which was also Dropbox. huge strength is more of a common market for. B2B or enterprise SAS companies. But at the time it was very uncommon.

More of a tops down sale was the norm for tech and especially B2B tech. And so it was instructive to be there during that time and be a part of the decisions around product strategy or even  growth and marketing strategy to figure out how do we leverage this rapid demand and growth and actually that allowed us to enter businesses.

So the way that it worked was individuals were using Dropbox in their personal lives and that they would say, why can't my work tools be this simple. And so they would just take Dropbox to work and use it for their work stuff. And then they would come to us begging for the most basic features that allowed them to run their business on Dropbox, like centralized billing or an admin panel. And that is actually how we started the B2B enterprise business. And from there, it was basically building, figuring out needs. and now that business has one of the biggest growth engines from drop-off and for Dropbox. And actually the entire company is oriented around.

More work oriented, or appealing to work users, but it was completely innovative at the time. And now there are so many companies like this, like notion and Figma, and all of these companies are leveraging that same product led growth strategy, and it's a completely different mindset to launching products.

The way that you actually build products is different. And it was new, in the Dropbox days. So that was really fun to be a part of that.

Nikunj: [00:12:11] That must have been easy though, going from a very consumer focused company and transitioning it to now, as you said, mostly focused on businesses, I'm sure there were a lot of, key moments of type one decisions. Can you share a few things that you might remember that didn't go so well during that time?

Sheila Vashee: [00:12:28] It was a very difficult transition actually. And the reason it wasn't difficult on the user side, it was difficult on the IT side because, and I remember sitting in many sales conversations with a CSO or CIO at a large enterprise organization and sitting there with the customer, the potential customer would say, I can't roll out Dropbox to my organization.

You're a consumer product. You're a toy. I can't, I'm going to get fired if I, have everyone at the company using a toy. And so it was on us to change that perception. And that took a lot of work. Everything from working with Gartner on the magic quadrant to publishing all kinds of research, to endless events and trade shows and getting in front of these it decision makers and hammering the same message again.

And again, actually we took a lot of notes from the companies that did it really well at the time. Like the Salesforce is of the world, et cetera. Because we were basically trying to overlay this enterprise sales model on top of this massive product led growth engine. So it was like operating two businesses at the same time.

So it was a fascinating experience. And then, and concurrently, we were launching all these other products like carousel  and we acquired mailbox and some of them worked out. Some of them didn't know carousel didn't and we made a lot of mistakes there that I definitely learned from.

Nikunj: [00:13:51] I was going to get into trying to understand how, Dropbox acquired consumer companies that people love like carousel and mailbox, but eventually had to shut those well loved products down. Was it primarily because they didn't think it fit in the strategy or they weren't seeing growth?

Sheila Vashee: [00:14:09] I'll talk about carousel. That one actually was launched out of Dropbox. we didn't acquire the company. And it was actually a good product. I think

we bothered over that. 

Nikunj: [00:14:21] yeah, I loved, I love carousel and I think, now I love Google photos because of the same reasons. It's seamless upload, easy to share, delightful moments in the product. 

Sheila Vashee: [00:14:32] Yeah. And that was, so that was basically what was appealing about carousel. It was so easy to use and it had some killer features like, scroll and, search, but it. Was competing with free. And at the time we didn't realize that was going to happen, obviously. You never know. And the Google photos, products and others move so quickly and launched and carousel actually, you had to pay for Dropbox to be able to store your photos.

And so that became a barrier that people had to cross and their other options were free. And so that ended up being a hurdle for the growth of that product. But the mistake that we made aside from the thinking on product strategy is we made a huge public splash about the app. And that was before we really had much traction.  We were overconfident because every feature we had launched, every product we had launched up until that point had immediately been successful.

And so we assumed that would be the case here. And it did a huge launch public launch, paid a lot of money and it flopped and there, it was a huge media. Excuse my language, but shitstorm. And we learned a lot from that so that is not a strategy I would advise

 Nikunj: [00:15:56] And then you move from a purely digital company, like Dropbox to something that involves  now a lot of operations, like Opendoor. Walk us through what were some of the challenges, interesting things that you observed.

Sheila Vashee: [00:16:12] Oh boy, it, operations are hard. That's the main thing I observed is, very well Nikunj. I think, one of the big differences is that with a SAS product, that the cost of. Delivering the product is almost nothing. And so there are no limits on how much you can grow, how quickly you can grow.

There's no other side of the marketplace that you need to balance. And obviously for open door and a lot of these ops heavy companies there is. And so being on the marketing and growth side at opendoor, is not an easy proposition because you're not only trying to grow. You're trying to thread the needle between the right amount of, too much and too little growth to feed the other side of the equation. And that's a huge challenge.  The second one is the actual ops are hard. And they, there are people intensive, they're on the ground. And like the day to day is so much harder than you realize, like things go wrong and you have to be on top of it.

And the people, I think so highly of the team at Opendoor, because they're able to standardize and make that process as efficient as possible. But it's not easy. not anyone could do it.

Nikunj: [00:17:27] Do you have some learnings from, how did you thread that needle?

Sheila Vashee: [00:17:31] I always thought that a couple things. So first I felt that the way that we thought about growth from a portfolio standpoint was really smart because it was really, it would be difficult to try to manage the dynamics in any given market, given the real estate trends economy. Other things that are happening, exogenous shocks, like it's almost impossible to hit the nail on the head in one market.

But when you're looking at 21 markets, it's much easier to balance and shift dollars to where they make the most sense. And as we did that very regularly. So we did GG our boss used to say that we were more of a trading desk than a marketing growth team anyway. So I always thought that was smart.

I think the other thing is, just being extremely communicative and clear cross-functionally and set up clear boundaries. So everyone knows what you're marching towards. That helps a lot. And then, finally just being open and, acknowledging that it's not easy and recognize that we're going to make mistakes and figure it out.

And, and having everyone be on the same page from that standpoint. And again, I think Opendoor did a good job of that.

Nikunj: [00:18:41] Early this year you decided to transition from running a group and marketing teams to being a venture capitalist. Why did you make that decision?

Sheila Vashee: [00:18:51] So it's always been part of who I am as you mentioned. back in the early days, the starting up of something and those early days of a new idea and getting out to the market to see who's interested in it is the most exciting for me. And so the prospect of being able to partner with amazing founders and help them.

help fund their ideas was a really, enticing one to me. And so it's, it's been a few months and I can't tell you how fun it's been.

Nikunj: [00:19:24] Where to capital, historically, and even today has predominantly been skewed towards men. Are you starting to see that landscape shift a bit?

Sheila Vashee: [00:19:32] A bit    it's been a slow journey and I wish that the landscape was shifting faster than it is. In fact, actually through COVID funding for female founders has decreased rather than increased, which is sad to see. there are improvements, but there's a lot more that we need to do.

And organizations like all raise and others are doing. Starting to shift the focus to enabling more people. and it's not just women, it's also underrepresented minorities and so many different groups allowing them the same access to capital and connections that, people in tech or, traditionally, certain sets of people had before.

So we've made progress, but there's much more work to do.

 Nikunj: [00:20:19] In your first few months as a venture capitalist, what are some trends that you're really excited about?

Sheila Vashee: [00:20:24] Lots. So many things. One thing that is blowing up right now is just the  low-code no-code world. The reason I'm excited about that is because  it allows more people to develop tools. It allows more people have access to building software.

So that one's really exciting, obviously through COVID the shift to remote work has opened up, just a vast kind of set of new opportunities and new ways that people need to figure out how to help people work together, whether it's managing a team remotely or better collaboration tools or better video tools, really the the list is endless. And then, the other really interesting area that I've been spending some time on is how even how SMBs can work together and how they procure their goods. And, that has also been disrupted through COVID and probably won't go back to the way it was, the trade shows and other things that traditionally happened.

And so that's an interesting space as well.

Nikunj: [00:21:21] You've worn a lot of hats from iBanking to corporate strategy to marketing, and now being a VC. Do you have a favorite yet?

Sheila Vashee: [00:21:31] Oh man, that's hard. There's so many things that are good about each role. I think my favorite is hanging out with you Nikunj can I, can

that be my 

Nikunj: [00:21:38] that's a cop out answer. You got to pick Sheila

Sheila Vashee: [00:21:41] Okay. right now, I'm really enjoying what I'm doing. it's really fun to get a chance to work with early stage companies, founders on new ideas. And I love the variety every day. It's something new and different, exciting.

Nikunj: [00:21:54] That's awesome. I always like to end the show as you know, by asking our guests to share a time that felt like a roller coaster. And what did you learn from it?

 Sheila Vashee: [00:22:04] 2020 has been a rollercoaster. I don't think that anyone will disagree with that. And your, this is we're recording this kind of during the election time right now, which I don't know if I've ever been so emotionally drained in my life, but in general also, work-wise. We were both at Opendoor and the beginning of the year, and it was the beginning of COVID was tough for every company that was in the real estate, heavy operations space.

And the company did an amazing job turning that around and putting in place safeguards to, be able to continue to grow. and now it's. it's going through a SPAC. So if that's not a rollercoaster, I don't know what it is. And I'm so happy now. But, earlier in the year, I think we were all a little scared.

Nikunj: [00:22:51] 2020 truly has been a roller coaster. I want to thank you for taking the time and sharing about all your highs and lows. It's been really fun chatting with you today, Sheila.

Sheila Vashee: [00:23:03] Thank you so much. It was such a pleasure to be here.